While exchanges have had the capacity to monitor trading activity for sometime, this capacity has not been generally available to other market intermediaries, including brokers. Compliance Explorer employs the experience that our research team has gained building real-time surveillance systems for 17 national exchanges and regulators. The system makes surveillance more generally available to the market, importantly without the need to develop and install sophisticated software and relevant databases in-house. Using a series of proprietary algorithms, Compliance Explorer adds a second instantaneous level of market oversight to securities markets where it is deployed.

The Target Audience

• Security Exchanges’ Surveillance Officers
• Security Dealers’ Compliance Officers

What does it do?

Compliance Explorer includes a number of processes which identify irregular market behaviour including:

• Market Manipulation
• Marking the Close
• Pre-arranged Trading
• Wash Sales
• False and/or Misleading Trading
• Domination and Control
• Insider Trading
• Front Running / Client Precedence
• Order Handling
• Short Selling
• On-market Buybacks
• Large Orders (Substantial Shareholding)
• “Greenshoe” (Market Stabilisation)
• Trading in securities on Watchlist or Restricted List

Any of these behaviours compromise the integrity of the market. Being made aware of them, in real time, improves the quality of your market.
Underlying Methodology

The Compliance Explorer functions by taking a direct feed of the trading data for a securities dealer from the relevant exchange. That data is then passed through the highly developed system which identifies patterns in trading. The user determines the behaviours they wish to be notified of and the system will trigger an “Alert” when the pattern is identified.
How does this compare with currently available Compliance Systems?

Unlike many compliance systems, Compliance Explorer does not require the installation and maintenance of IT infrastructure for the compliance alerting function. All Alerts are delivered to the securities dealer via a secure channel across the Internet.

Features in development for the Compliance Explorer include:

• The production of customised alerts at the request of the securities dealer
• The development of anti-money laundering alerts
• The implementation of the Compliance Explorer across international markets, and across futures and derivatives markets

Compliance Explorer is a unique system suitable for all market participants, large or small.